Page 1 Liaoning Medium Cities Urban Infrastructure Environmental Project (LMCP-2) Resettlement Policy Framework December 2006 A. Project Introduction 1. The development objective of the project is to contribute to the economic and ecological revitalization of Liaoning Province by improving service levels in water, wastewater, and solid waste management through the provision of infrastructure and enhancement of utility performance in 4 project cities and 4 county towns. 2. The LMCP-2 covers the medium-sized municipalities of Anshan, Fushun, Yingkou, Panjin as well as county level city of Xingcheng, Haicheng, Gaizhou. The project is addressed as a comprehensive urban environmetal project, where in each city components targeting investments in water supply, wastewater treatment and solid waste disposal infrastructure construction and upgrading. The LMC-2 will compose of 12 components on the fields of the urban water supply (5), wastewater treatment (4), solid waste disposal (3). The detailed contents of the project are showed as follows: Anshan: 1) Urban water supply - Upgrade an existing 150,000 t/d water purifying plant (removal Mn/Fe) - Construct/upgrade 122 km distribution pipeline/network - Install/upgrade the measuring meter for 65,000 households Haicheng: 2) Urban water supply (Xingcheng is county level city under Anshan city) - Construct/upgrade the existing Yuhuangshan water plant and Zhongyangpu water field - Construct/upgrade 74.1 km distribution pipeline/network - Install 25,000 water meters. Fushun: 3) Fushun Wastewater Project includes two subcomponents: (a) Fushun Sewerage Upgrading, and (b) Fushun Integrated River Works (Eastern Part of Hun River). (a)Fushun Sewerage Upgrading - Newly construct Liushan-Guchengzi Interceptors: 7,813 m, 24.08 million RMB. - Rehabiliate Urban Sewers/Channels: upgrade 20.665 km wastewater interceptors, 8.32km open channels and 5.325km sub-sewers. (b)Fushun Integrated River Works (Eastern Part of Hun River) - Flood Protection Embankment: construct concrete slab revetment along the river bank from the east of Tianhu Bridge to the south of Zhangdang Bridge. Total length will be 8.1km. - Drainage System: construct 5.54km sewer pipelines and 2 pump stations. - Road Construction: 8.41km road from Tianhu Bridge to Zhangdang Bridge. RP398 v.1 Page 2 4) Solid waste disposal - solid waste collection, storage and transfer to disposal and upgrade 14 existing old collection stations - a sanitary landfill and associated leachate treatment / disposal facilities, with daily capacity of 600 ton/day and 17 years service life. Gaizhou 5) Waste water treatment plant - 50,000 ton/day WWTP in Phase I, (to be enlarged in 100,000 ton/day in Phase II) - Newly construct 3.65 Km Interceptor - Upgrade / newly construct 16.38km Sewers - Newly construct 1 Seweage Pump Station Panjin: 6) Wastewater treatment - Construction of 50,000m 3 /d Panjin No. 2 Municipality Waste Water Treatment Plant for Shungtaizi District. - Upgrade 19.19 km drainage pipeline and 8 pumping stations - Construct a new pumping station 7) Water Distribution Network Upgrading - Pipeline Upgrading: 133.5 km Water Distribtion Pipeline Upgrading. - Water Loss Monitoring Equipments: Purchasing 4 sets of water loss Monitoring Equipments and corresponding vehicles (2.42 million RMB) - Water Meters (and Meter Chambers): Install 205 bulk meters for Residential Districts (0.08 million RMB); Replacement of 93,262 water meters and 6,217 underground meter chambers. 8) Solid waste disposal - Construct a new sanitary landfill plant (675 t/d) with the collection/transfer system - Eliminate the existing waste combustion plant Xingcheng: 9) Urban water supply - Upgrade 24682.4 m water distribution networks (DN100-1000) - Construct two boosting pump stations - Water meters system upgrading: install 2200 water meters and 220 meter wells. Yingkou: 10) Solid waste disposal for EDZ - Construct a new solid water disposal plant (820 t/d) with collection/transfer system - Close the existing solid waste dumping site 11) Wastewater treatment - Newly construct 100,000m3/day Eastern Wastewater Treatment Plant. - Drainage and interceptor sewers in southern and eastern districts, 68035 m. - Upgrade two pump stations and newly construct 6 pump stations 12) Urban water supply (Shinmen reservoir) - Construct the intake work, a 70,000 t/d purifying water plant and 31.3 km transportation pipeline Page 3 - Upgrade water distribution system: newly construct 46.216 km and upgrade 13.351 km - Newly construct reclaimed water pipelines for 65.263km. 3. Since some aspects of the urban infrastructure is not fully determined and the possibility of land acquisition and relocation is possible in the future, this Resettlement Policy Framework (RPF) is prepared as a guideline for resettlement preparation and implementation, if there is any. B. Principles and Objectives 5. In World Bank assisted projects, final borrowers or component sponsors are expected to take all necessary measures to mitigate adverse social impacts. The costs associated with mitigation of adverse social impacts on project affected people, such as relocation of affected persons or restoration of livelihoods will be met by the component sponsors. The general guidelines of this RPF are to be followed by all components under the Loan involving involuntary resettlement. Where adverse social impacts are identified, plans for resettlement and rehabilitation (R&R) will need to be prepared based on policies and procedures laid out in this framework. 6. Every effort will be made to avoid or minimize the need for land acquisition and resettlement for any components. In the unlikely and exceptional event that any of the components under the project require additional land, houses and other assets becomes unavoidable; the component sponsors shall adopt this RPF. 7. The principle objective of the RPF is to ensure that all Project Affected People (PAP) will be compensated for their losses and provided with rehabilitation measures to assist them to improve, or at least maintain, their pre-project living standards and income earning capacity. 8. The PAP includes the following persons to be identified by the baseline information collected: (a) The persons whose place of business or employment, and/or agricultural land is in part or in total affected (permanently or temporarily) by the subprojects; (b) Persons whose houses are in part or in total affected by the subprojects; (c) Persons whose business are affected in part or in total (temporarily or permanently) by the subprojects; and (d) Persons whose crops (annual and perennial), trees and fixed assets are affected in part or in total by the subprojects. 9. The principles outlined in the World Bank’s OP/BP 4.12 have been adopted in preparing this RPF. In this regard the following principles and objectives would be applied: (a) Acquisition of land and other assets, and resettlement of people will be minimized as much as possible. Where land acquisition is unavoidable, the project will be designed to minimize adverse impact on the (PAP), especially the vulnerable groups; Page 4 (b) All PAP will be compensated, relocated and rehabilitated, if required, so as to improve their standard of living, income earning capacity and production capacity, or at least to restore them to pre-Project levels; (c) All PAP residing in, or cultivating land, or having rights over resources within the components area of the socioeconomic survey are entitled to compensation for their losses and/or income rehabilitation. Lack of legal right to the assets lost will not bar the PAP from entitlement to such compensation, rehabilitation and relocation measures; (d) The rehabilitation measures to be provided are (i) compensation at full replacement cost for houses and other structures; (ii) compensation for land acquisition and resettlement subsidy for the affected villages and farmers; (iii) dislocation allowance and transition subsides; (iv) full compensation for crops, trees and other similar agricultural products at market value; and (v) other assets, and appropriate rehabilitation measures to compensate for loss of livelihood; (e) Replacement house-plots, place of business and agricultural land will be as close as possible to the land that was lost, and acceptable to the PAP; (f) Land-for-land is the preferred option. Land-for-land may be substituted by cash provided that: (i) land is not available in the proximity of the subproject area; (ii) PAP willingly accept cash compensation for land and all assets on it; and receive full replacement value without any deductions for depreciation; and (iii) cash compensation is accompanied by appropriate rehabilitation measures which together with project benefits results in restoration of incomes to at least pre-subprojects levels; (g) The resettlement transition period will be minimized, land-for-land and/or cash compensation provided to the PAP completed prior to the expected start-up date of works in the respective components. (h) Resettlement plans will be implemented following consultations with the PAP, and will have the endorsement of the PAP; (i) The previous level of community services and access to resources will be maintained or improved after resettlement; (j) Any acquisition of, or restriction on access to resources owned or manage by PAP as common property will be mitigated by arrangements ensuring access of those PAP to equivalent resources on a continuing basis; (k) Financial and physical resources for resettlement and rehabilitation will be made available as and when required; (l) Resettlement program will include adequate institutional arrangements to ensure effective and timely design, planning and implementation of resettlement and rehabilitation measures; (m) Adequate arrangements for effective and timely internal and external monitoring will be made on implementation of all resettlement measures; (n) Wherever possible the components will ensure that local residents in the affected areas benefit from the services and facilities created for, or by, the components. C. Process for Preparing and Approving Resettlement Plans Page 5 10. All components involving involuntary resettlement will be required to carry out a socioeconomic survey to determine the impact on the affected area and the affected population. The survey will determine whether or not the component would need preparation of a Resettlement Plan (RP) or an Abbreviated Resettlement Plan (ARP) to offset adverse impacts and access to benefits by the affected communities. The main sequential steps involved in the resettlement approval process are as follows: (a) Component sponsor furnishes preliminary information report on the proposed component to Liaoning Urban Construction and Renewal Project Office(LUCRPO) and the local authorities at the earliest possible stage. The preliminary information report would contain basic information on: (i) the proposed location of project; (ii) the total area of land required for the physical component , the type of land, current land use and possible impacts of land use changes, and the proposed strategy for land acquisition; and (iii) the people to be affected by the component including those losing home, land or livelihoods; and those deriving benefits (employment, electricity, etc.) from the component ; (b) LUCRPO will, after its review and consultation with the local authorities, inform the component sponsor to prepare a resettlement document according to this RPF; (c) For each component that may involve resettlement, the Bank requires a satisfactory resettlement plan or an abbreviated resettlement plan that is consistent with the provision of the policy framework be submitted to the Bank for approval before the component is accepted for Bank financing. When the number of persons affected by the component exceeds 200, a resettlement plan shall be prepared. Where impacts on the entire affected population are minor, or fewer than 200 people are affected, an abbreviated resettlement plan may be agreed with the borrower. Impacts are considered “minor” if the affected people are not physically displaced and less than 10% of their productive assets are lost; (d) The component sponsor prepares the RP or ARP and submits it to the local authorities, LUCRPO and the World Bank for review/concurrence; (e) The reviewers shall verify the adequacy of the report in light of policies, principles and procedures set out in this RPF, and convey the decision to the component sponsor; (f) After obtaining concurrence of the World Bank, the component sponsor executes the RP or ARP which would also contain terms and conditions related to implementation of the plans agreed in the RPF. 11. The ARP for each component will be prepared by the respective component sponsor in accordance with the provisions of this RPF. The ARP includes the following contents: (a) a census survey of displaced persons and valuation of assets; (b) description of compensation and other resettlement assistance to be provided; (c) consultations with displaced people about acceptable alternatives; Page 6 (d) institutional responsibility for implementation and procedures for grievance redress; (e) arrangements for monitoring and implementation; and (f) A timetable and budget. 12 The RP to be submitted thereafter needs not include the policy principles, entitlements, and eligibility criteria, organizational arrangements, arrangements for monitoring and evaluation, the framework for participation, and mechanisms for grievance redress set forth in the resettlement policy framework. The component - specific resettlement plan needs to include baseline census and socioeconomic survey information; specific compensation rates and standards; policy entitlements related to any additional impacts identified through the census or survey; description of resettlement sites and programs for improvement or restoration of livelihoods and standards of living; implementation schedule for resettlement activities; and detailed cost estimate. The RP includes the following contents: (a) Description of the component; (b) Potential impacts; (c) Socioeconomic studies and baseline census; (d) Additional policy entitlements; (e) Compensation rates for losses; (f) Resettlement measures; (g) Site selection, site preparation, and relocation; (h) Housing, infrastructure, and social services; (i) Implementation schedule; (j) Costs and budget D. Estimated Population Displacement 13. It is foreseen that the impacts for the newly added alignment under the component of RI are minor. During the project implementation, new proposals under the component may be made; or the Resettlement Plan prepared may need to be revised or updated. E. Eligibility Criteria 14. The entitlement policy aims to enable PAP to replace the assets they have lost on account of the project, to recover and to improve upon their pre-component living standards within the shortest possible time. In general, the resettlement & rehabilitation (R&R) package would consist of (a) provision for replacement assets or its cash equivalent, where replacement is not feasible; (b) rehabilitation grants to compensate for temporary disruption in life and economic activities; (c) either employment or training, capital and enterprise support for income restoration in case of loss of livelihoods, and (d) provision for replacement of community facilities and services for affected communities. 16. PAP losing house and auxiliary structures will be entitled to the following compensation and rehabilitation measures: (a) PAP whose houses are being acquired by the components will be provided replacement housing within easy communing distance of their existing homes; Page 7 (b) PAP will be provided with compensation at full replacement value, without any deduction for depreciation, for any structures and fixed assets affected by the components ; (c) A pre-determined dislocation allowance according to the prevailing rates of the component areas will also be provided. 15. PAP losing agricultural land will be entitled to the following types of compensation and rehabilitation measures: (a) for the majority of schemes, the land will be reallocated within the village by the village committees. According to the Land Administration Law, it situations where land reallocation is not possible, the PAP will be paid a maxim compensation and resettlement subsidy equivalent to 6 times of the average annual production output value of the land in the previous three years. If this is not sufficient to restore the livelihoods of the PAP to the pre-component level, the compensation/subsidy may be raised to a maximum of 15 times of the average annual output value of the land in the previous three years; (b) If land compensation and resettlement subsidies paid are still insufficient to help the PAP needing resettlement to maintain their original living standards, the resettlement subsidies may be increased upon approval b y the People’s Governments of Tianjin Municipality. However, the total land compensation and resettlement subsidies shall not exceed 30 times the average annual value of the requisitioned and for the three years preceding such requisition; (c) These amounts will be paid to the village committees whose land is affected and will be used for (i) increasing land areas under cultivation if land is available; (ii) intensification of agriculture through provision of irrigation, improved agricultural practices, etc.; and (iii) development of non-agriculture based income generation activities. PAP will be compensated for the loss of standing crops, fruit or industrial trees, as well as any fixed assets at market prices; (d) PAP whose land is temporarily taken by the works under the components will be compensated for their loss of income, standing crops and for the cost of soil restoration and damaged infrastructures. 17. If the house and/or structure is only partially affected by the components , the component sponsors may, if its is acceptable to the PAP, acquire the entire structures with full compensation or provide cash compensation for the portion affected as mutually agreed between the PAP and the sponsors. 18. PAP losing business will be entitled to the following compensation and rehabilitation measures: (a) The mechanism for compensation loss of business will be: (i) the provision of alternative business site of equal size and accessibility to customers, satisfactory to the PAP; (ii) cash compensation to the owner for lost business structure reflecting full replacement cost of the structures, without depreciation and the cost of transfer; and (iii) cash compensation for the loss of income during the transition period. Page 8 (b) PAP will also be provided compensation at full replacement cost, without depreciation for any other fixed assets affected in part or in total by the subprojects. F. Legal Framework 19. The Land Administration Law of the People’s Republic of China (issued on 28th, Aug, 2004) , Regulations for the Implementation of the Land Administration Law of the People's Republic of China(Adopted on 28th, Aug, 2004), Guiding Opinions on improving system of Land Acquisition, Compensation and Resettlement (Adopted on 3rd, Nov, 2004), the Law on Administration of Urban Real Estate of the People’s Republic of China (January 1995); the Regulations on Administration of Urban House Dismantling and Relocation (Order No. 305 of the State Council of the People’s Republic of China which was approved at the 40 th executive meeting of the State Council held on June 6, 2001), Guiding Opinions on Appraisal of Urban House Dismantlement(Adopted on 1st, Jan, 2004), and relevant Liaoning Provincial and project municipal regulations constitute the legal framework governing the implementation of this RPF. The World Bank’s OP/BP. 4.12 on Involuntary Resettlement sets forth all the resettlement policies and principles which will be well considered by the Liaoning Provincial Government. G. Organizational Procedures 20. Although the primary responsibility for enforcement of the RPF and implementation of the R&R rest with the component sponsors, the oversight responsibility shall rest with Liaoning Provincial Government via LMCPO in coordination with the respective local government authorities in each of the component areas. LMCPO, with the authorization of Liaoning Construction Bureau, shall also carry out regular monitoring as required by the World Bank, to ensure that the provisions of the RPF are satisfied. H. Implementation Process 21. A detailed implementation schedule of the various activities to be undertaken will be included in the resettlement instrument. Payment of compensation and furnishing of other rehabilitation entitlements (in cash or in-kind), and relocation if that be the case, will be completed at least one month prior to the scheduled start-up date of works in the respective component site. I. Grievance Redress Mechanisms 22. Since the resettlement work will be carried out with the full participation of the PAP, it is expected that no major grievance issue will arise. However, to ensure that the PAP have avenues for redressing their grievance related to any aspect of land acquisition and resettlement, detailed procedures of redressal of grievances have been established in this RPF. The objective is to respond to the complaints of the PAP speedily and in a transparent manner, without resorting to complicated formal channels to the extent possible. 23. The procedures are as follows: Page 9 (a) Stage 1, any person aggrieved by any aspect of the resettlement document can lodge an oral or written grievance to the Community Committee, township/ town government or Residents Committee, District Government; (b) Stage 2, if the aggrieved person is not satisfied with the decision of the grass-roots authorities at Stage 1, s/he can present the case to the land administration bureau from those immediately above Stage 1 level through the highest authorities of the respective component area. (c) Stage 3, if the PAP is still dissatisfied with the decision of the higher authorities, the case may be submitted for consideration by the People’s Court in Accordance with the “Civil Procedure Act”. J. Funding Arrangement 24. Compensation of land is based on ten times of the average annual output value of the requisitioned land for three years preceding such requisition. Resettlement subsidies for requisition of cultivated land shall be six times the average annual output value of the requisitioned cultivated for three years preceding such requisition. 25. The value of the fix assets is estimated according to the replacement cost. Details of the cost estimation and other compensation for moving and loss of production/business are included in the Resettlement Plan prepared for the project before appraisal. 26. The land acquisition and resettlement compensation are sourced from the counterpart funds. All the funds shall be paid to the PAP before the land is taken and the house is demolished. K. Participation and Consultation 27. The component sponsors would be required to carry out the participation and consultation of the people in the component areas. A broad acceptance of proposed measures by the PAP – including relocation areas and replacement lands, compensation policies and rates, proposed income restoration measures for R&R – will be a necessary condition for approval of the resettlement plans. 28. PAP will participate throughout the various stages of the planning and implementation of the resettlement plans. For these purposes and prior to the preparation of the resettlement plans, the PAP will be informed of the provisions of this RPF at public meetings. Each affected household or shop will be fully informed by the relevant local governments of their entitlements and rehabilitation choices under the respective resettlement plan. L. Monitoring 30. The internal monitoring of resettlement impacts will be carried out by the component sponsors as an integral part of the implementation of the plans, and will cover the component and post-component periods. It will assess achievements against key implementation targets and objectives and, accordingly, make corrections in the plans where necessary. Periodical monitoring reports will be submitted to LMCPO. Page 10 In addition, the external monitoring, arranged under the Resettlement Plan prepared before the project appraisal, will cover all resettlement components under the project. wb11823 M:\AlexG\AlexG 05\~8794596.doc 0 1/04/2007 11:55:00 AM Page 11